1. Appeal and Error_appealability--requested relief granted
Plaintiffs were not aggrieved parties who could appeal the trial court's requirement that
they receive approval from the court before withdrawing their request for class certification.
Plaintiff argued that the court approval required by N.C.G.S. § 1A-1, Rule 23(c) applies only
after a request for certification has been granted, the court ruled that approval of the withdrawal
was required in this case, and the court then granted plaintiffs the relief they sought and allowed
the withdrawal.
2. Appeal and Error_preservation of issues_notice of withdrawal of class notification
request_no final decision_plaintiff's agreement
A purported error was not preserved for appellate review where the trial court required
plaintiff to notify potential members of a lawsuit class that the request for class certification been
withdrawn, a final decision was not made on the type of notice, and plaintiff agreed that some
type of notice was fair and necessary.
3. Appeal and Error_appealability_withdrawal of class certification request_court's
authority during decision_no final decision
The question of the trial court's authority during the withdrawal of a request for class
certification was not properly appealed where the court did not made a final decision.
4. Appeal and Error_appealability_order to attend show cause hearing_no final
decision
An order that an attorney withdrawing a request for class certification attend a show cause
hearing was not ripe for appeal because the court did not decide whether the attorney had
violated a court order and should be held in contempt. There was no final decision.
5. Appeal and Error_appealability_review of voluntary dismissal_not a final decision
The issue of whether an order that a voluntary dismissal would require court approval
was not ripe for review because no final decision was made. The court did not approve or
disapprove the settlement or the voluntary dismissal; it merely held that a review of the dismissal
was necessary.
Judge LEVINSON concurring in part and dissenting in part.
Abrams & Abrams, P.A., by Douglas B. Abrams, for plaintiff-
appellants.
Womble, Carlyle, Sandridge and Rice, P.L.L.C., by Burley B.
Mitchell, Jr. and Christopher T. Graebe, for defendant-
appellees.
EAGLES, Chief Judge.
Tony and Sarah Alexander, Roger and Penny Miller, Sharon Bell
Rich and Donny and Debra Williams (“plaintiffs”) appeal from orders
by the trial court entered on 13 and 19 February 2002. Plaintiffs
argue that the orders were erroneous because: (1) plaintiffs did
not need court approval before withdrawing their motion for class
certification; (2) plaintiffs were not required to give notice of
their intention to withdraw the motion for class certification; (3)
the trial court did not have the authority to force plaintiffs and
their attorneys to submit information regarding their contact with
the media; (4) the trial court did not have authority to force
plaintiffs' attorney to appear before another court to show cause;
and (5) plaintiffs' voluntary dismissal of their case against one
defendant did not require the trial court's approval. After
careful review of the record, briefs and arguments of counsel, we
dismiss this appeal as interlocutory and not affecting a
substantial right.
Plaintiffs here purchased automobiles from various dealerships
in North Carolina. The Alexanders bought a 1995 Jeep sport utilityvehicle from defendant Hickory Automall. The Millers bought a 1996
Dodge truck from defendant Empire Chrysler Dodge Jeep Eagle on 17
January 1998. Plaintiff Sharon Bell Rich bought a 1996 Dodge Grand
Caravan from defendant YSU Automotive on 28 November 1997. Donny
and Debra Williams purchased a 1996 Dodge Ram pickup truck from
Benson Ford-Mercury, Inc. on 6 November 1996. All of these
vehicles had been sold to an original owner and repurchased by
defendant Chrysler because of defects in the vehicles. Plaintiffs
contend that the vehicles were sold to them without disclosure
about the vehicles' defects or notice that the vehicles had been
repurchased by the dealers.
Plaintiffs filed suit against defendants claiming negligence
by defendants, unfair and deceptive trade practices and requesting
punitive damages. In the complaint, plaintiffs requested the trial
court to certify a class of plaintiffs and a defendant class
composed of dealerships.
Plaintiffs moved for certification of a plaintiff class and a
defendant class by a separate motion on 22 March 2001. Defendants
DaimlerChrysler Corporation and DaimlerChrysler Motors Corporation
moved to dismiss all plaintiff's requests and allegations regarding
a class action. On 12 June 2001, the case was transferred to the
Special Superior Court for Complex Business Cases.
On 7 November 2001, plaintiffs notified defendants that
plaintiffs were withdrawing their request and motion for
certification as a class. Defendants objected to plaintiffs'
withdrawal. Defendants argued that plaintiffs could not withdraw
their request for class certification unless plaintiffs receivedthe trial court's approval. Also, defendants stated that some type
of notice to putative class members was required before the class
certification motion could be withdrawn.
Plaintiffs filed a request to amend their complaint on 20
November 2001 so that the class action language could be removed.
Defendants DaimlerChrysler Corporation and DaimlerChrysler Motors
Corporation filed motions for summary judgment against all of the
plaintiffs individually. A document entitled “Disclosure Notice”
was attached to each motion filed against the individual
plaintiffs. The Disclosure Notice listed the repairs performed on
each plaintiff's vehicle and contained the purchasing plaintiff's
signature.
On 8 September 2002, plaintiffs settled their claims against
Defendant Auto, USA, which operates as Empire Chrysler Jeep Dodge
Eagle. Plaintiffs gave notice of the settlement and also
voluntarily dismissed their claims against Empire with prejudice.
The trial court ordered that plaintiffs could not withdraw
their request for a class certification, amend their complaint to
delete the request for class certification or voluntarily dismiss
their claims against any defendant without express approval from
the trial court. The trial court held that if the court did not
have an opportunity to review class certification withdrawals,
class plaintiffs could prejudice other members of the putative
class by withdrawing without notifying the other class members.
The trial court then allowed plaintiffs to withdraw the request for
class certification. However, the trial court required both
plaintiffs and defendants to submit affidavits detailing anycontact with the media regarding this case. Also, all parties were
ordered to submit a proposed plan of notification designed to
notify all potential class members who believed that plaintiffs
represented the other members' interests. Plaintiffs and
defendants DaimlerChrysler Corporation and DaimlerChrysler Motors
Corporation submitted a notification plan. The trial court has not
decided what type of notification to potential class members is
appropriate in its 19 February 2002 order or in any other order.
Defendants also requested immediate contempt sanctions against
plaintiffs' counsel H.C. Kirkhart on 8 November 2001. Kirkhart had
been enjoined from soliciting prospective clients from customer
lists and other information he received as part of discovery
against DaimlerChrysler. Defendants alleged that Kirkhart
solicited clients in violation of that injunction. Kirkhart
responded to defendants' allegations by stating that any
solicitation that he participated in took place when the
information was a matter of public record or otherwise when the
injunction was not effective. The State Bar conducted an
investigation of Kirkhart's activities and found no violation of
the Rules of Professional Conduct. By an order on 13 February
2002, the trial court instructed Kirkhart to appear before the
trial judge that issued the injunction and show cause why he should
not be held in contempt for violating the injunction. In its 13
February 2002 order, the trial court did not hold Kirkhart in
contempt or force him to end his representation of plaintiffs. No
hearing has yet been held by the trial court that originally issuedthe injunction against Kirkhart. Plaintiffs appeal from the trial
court's orders entered on 13 and 19 February 2002.
We note that a party cannot appeal an interlocutory order by
the trial court unless the order affects a substantial right. G.S.
§ 1-277 (2001). A judgment or order is considered interlocutory if
it is not a “final determination of the rights of the parties.”
G.S. § 1A-1, Rule 54(a). An appeal may only arise from a final
determination of all the parties' claims by the trial court. G.S.
§ 1A-1, Rule 54(b). Also, G.S. § 1-271 states that “[a]ny party
aggrieved may appeal . . . .” However, a party is considered to be
aggrieved only if the party's “rights have been directly and
injuriously affected by the action of the court.” N. C. Trust Co.
v. Taylor, 131 N.C. App. 690, 693, 508 S.E.2d 809, 811 (1998)
(quoting Culton v. Culton, 327 N.C. 624, 625, 398 S.E.2d 323, 324
(1990)).
[1] Plaintiffs' first argument asserts that the trial court
erred by holding that plaintiffs were required to receive the trial
court's approval before plaintiffs could withdraw their request for
class certification. Plaintiffs and defendants dispute the
applicability of Rule 23 of the North Carolina Rules of Civil
Procedure:
A class action shall not be dismissed or
compromised without the approval of the judge.
In an action under this rule, notice of a
proposed dismissal or compromise shall be
given to all members of the class in such
manner as the judge directs.
G.S. § 1A-1, Rule 23(c). Plaintiffs argue that the requirement of
court approval outlined in Rule 23(c) only applies after a request
for class certification has been granted and does not apply to thesituation here where class certification has only been requested.
Here, the trial court found that plaintiffs were required to have
court approval before they could withdraw their request for class
certification by amendment of their complaint or by a separate
motion. After analyzing the possible negative effects on potential
members of the class lawsuit, the trial court also stated in its
order that withdrawal of the class claims was justified. The
trial court granted plaintiffs the relief they sought by allowing
the withdrawal of the class claims. As a result, plaintiffs are
not “parties aggrieved” who are allowed to appeal this issue.
Accordingly, plaintiffs' first assignment of error is overruled.
[2] Plaintiffs contend that the trial court erred by requiring
plaintiffs to notify potential members of the lawsuit class that
plaintiffs had withdrawn their request for class certification.
Plaintiffs argue that notification of putative members of the class
is not necessary because Rule 23(c) does not apply in this
instance. Plaintiffs contend that no prejudice could affect
possible class members if the class certification request was
voluntarily withdrawn. We decline to address plaintiffs' arguments
on this issue for two reasons. First, no final decision has been
made on what type of notice will be proper in this case. According
to Rule 54, appellate review is not proper because the trial court
has not issued a final decision on notice. Second, this purported
error has not been preserved for appellate review according to
N.C.R. App. P. 10(b). During the trial court hearing, plaintiffs
agreed with defendants that some type of notice to the putative
class was fair and necessary before the class certification waswithdrawn in this case. Therefore, plaintiffs' second assignment
of error has no merit and is overruled.
[3] Plaintiffs also dispute the trial court's authority to
order both parties to submit affidavits about the parties' contacts
with the media. Plaintiffs argue that this information was
irrelevant to the trial court's decision. During the trial court
hearing, defendants presented evidence of plaintiffs' extensive
contacts with various members of the media. The trial court found
that “[t]he existence of that publicity substantially increases the
likelihood that there are absent class members who may be relying
on the class representatives to pursue their claims.” The issue of
notification is tied to plaintiffs' contacts with members of the
media. However, since the trial court has not made a final
decision regarding what notification should be given to the
putative plaintiff class, this issue may not be properly appealed.
This assignment of error is dismissed.
[4] Plaintiffs' fourth argument refers to the trial court's
holding in the 13 February order that plaintiffs' attorney Kirkhart
was required to attend a show-cause hearing. The trial court did
not decide whether or not Kirkhart had violated a court order and
should be held in contempt of court. Instead, the court referred
Kirkhart to the judge who signed the original order that he was
accused of violating. Since the trial court made no final decision
on this matter, it was not ripe for appeal. Plaintiffs' fourth
assignment of error is overruled.
[5] Plaintiffs assign error to the trial court's holding that
the voluntary dismissal of the Millers' claims against defendantEmpire would require court approval. Again, no final decision has
been made on this issue in the order. The trial court did not
approve or disapprove the settlement agreement or voluntary
dismissal; it held that a review of the dismissal was necessary.
Accordingly, this issue was not properly appealed.
For the reasons stated, this appeal is dismissed. Defendants
Hickory Automall and YSU Automotive's motion to dismiss this appeal
based upon appellate rule violations is denied. Defendants
DaimlerChrysler Corporation and DaimlerChrysler Motors
Corporation's motion to dismiss this appeal as interlocutory is
granted, but their request for payment of attorney fees is denied.
Dismissed.
Judge BRYANT concurs.
Judge LEVINSON concurs in part and dissents in part.
LEVINSON, Judge, concurring in part and dissenting in part.
While I agree with the majority's dismissal of plaintiffs'
appeal, I respectfully dissent from the denial of defendants'
motion for attorney fees.
Under N.C.R. App. P. 34, “Frivolous appeals; Sanctions” this
Court is authorized under certain circumstances to impose
sanctions, including attorneys' fees, upon a party:
(a) A court of the appellate division may . .
. impose a sanction against a party or
attorney or both when the court determines
that an appeal or any proceeding in an appeal
was frivolous because of one or more of the
following:
(1) the appeal was not well grounded in fact
and warranted by existing law or a good faith
argument for the extension, modification, or
reversal of existing law;
. . . .
(b) A court of the appellate division may
impose one or more of the following sanctions:
. . . .
c. reasonable expenses, including
reasonable attorney fees . . . .
N.C.R. App. P. 34(a)(1); (b)(2)c (emphasis added). I conclude that
in the present case plaintiffs' interlocutory appeal was “not . .
. warranted by existing law or a good faith argument for the
extension, modification, or reversal” of existing law.
Accordingly, I would grant defendants' Rule 34 motion for
sanctions, and would require plaintiffs to pay defendants'
reasonable attorney fees. See Steadman v. Steadman, 148 N.C. App.
713, 714, 559 S.E.2d 291, 292 (2002) (imposing Rule 34 sanctions,
including attorney's fees, where “this Court is constrained to
conclude that the appeal was taken for an improper purpose so as to
cause unnecessary delay and needless increase in the cost of this
litigation”).
Regarding plaintiffs' appeal from a holding that they would be
required to provide notice to potential class members of their
intention to withdraw their motion for class certification, I note
plaintiffs conceded during the motions hearing in the trial
division it would need to provide some notice to putative class
members. Further, the trial court's ruling is entirely
interlocutory; at this juncture the trial court has merely
memorialized its intention to require notification and has not even
ruled on the type of notice it will require. Interestingly,
plaintiffs rely on defendants' estimate of $100,000 to providenotice as a ground for appeal. Specifically, plaintiffs contend
that the outlay of this amount of money affects a substantial
right. Again, however, we have no idea of what type of notice the
trial court will require _ or the attendant cost _ or upon which
parties this burden might fall. Perhaps the cost will be $10,000.
Maybe $1,000,000. We cannot know at this point. Plaintiffs also
contend that the trial court's order requiring them to provide
affidavits related to their contacts with the media, consumer
groups, trade associations or attorneys affects a substantial right
that would be lost without relief from this Court, namely their
ability to “further investigate the long-standing pattern of
corporate misconduct by Appellees DaimlerChrysler.” The force of
this argument is completely lost, however, when one considers the
fact plaintiffs have previously voluntarily complied with this
directive of the trial court. Further, in a related assignment of
error, plaintiffs contend the trial court erred in holding that
court approval of the Millers' voluntary dismissal of claims
against Empire Dodge was required. As the majority opinion
correctly points out, however, the trial court has not yet approved
or disapproved the voluntary dismissal. The gravamen of
plaintiffs' appeal _ that the trial court lacks the authority to
require notification under the facts of this case, and that court
approval of a voluntary dismissal is not required _ will not be
lost by a later, proper appeal.
Plaintiffs also purport to appeal from the trial court's order
referring defendants' Show Cause motion to Judge Stafford G.
Bullock, who was designated by Judge Donald W. Stephens, SeniorResident Superior Court Judge, to hear matters related to this
issue. Plaintiffs' contention, that the order of the trial court
referring the Show Cause to another judge affects a substantial
right, is patently frivolous. The order was a routine
administrative transfer which determined no substantive issue in
the case, and affected no substantial right. See Romig v.
Jefferson-Pilot Life Ins. Co., 132 N.C. App. 682, 686, 513 S.E.2d
598, 600 (1999), aff'd, 351 N.C. 349, 524 S.E.2d 804 (2000) (Court
dismisses as interlocutory defendant's appeal from discovery order
that did “not impose sanctions or adjudge defendant to be in
contempt[,]” and rejects argument that order “deprives defendant of
the substantial right to a fair and impartial adjudication of the
class certification issue”). The trial court's order itself
states, “[w]hether the contempt, if any, is civil or criminal is a
determination this Court will leave to the judge who hears the
motion.”
Plaintiffs' appeal has needlessly extended this litigation and
prevented the trial court from conducting, inter alia, a hearing on
defendants' Show Cause motion. It is self-evident this appeal does
not affect any substantial rights. I would grant defendants'
motion for attorney fees.
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